Accounting Association Pre-announces Key Inspection Targets for Financial Statements of Unlisted Corporations

[Asia Economy Reporter Ji-hwan Park] The Korean Institute of Certified Public Accountants (KICPA) announced in advance on the 30th the key accounting issues to be focused on during the review of financial statements of non-listed companies (excluding companies required to submit business reports) for the 2021 fiscal year.

KICPA selected four major issues for focused inspection: △appropriateness of accounting treatment and note disclosures for related party transactions △appropriateness of accounting treatment for inventory △appropriateness of accounting treatment for equity-method investments △appropriateness of recognition of deferred tax assets and liabilities.

KICPA conducts financial statement reviews and audits of non-listed companies in accordance with the External Audit Act. In 2022, it plans to select target companies and proceed with procedures such as financial statement reviews.

A KICPA official stated, "By announcing the key accounting issues to be focused on in advance, companies and auditors will be able to pay attention to these matters beforehand, which is expected to help prevent accounting errors and create an environment for careful accounting treatment."

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